The Algerian army has surrounded a compound at a gas field in the east of the country, operated by the UK’s BP where an Islamic militant faction has taken at least 20 foreign workers hostage.

News reports from Algeria have stated that at least two people, one Briton and one Algerian, have been killed in the attack at the Amenas gas field, which is about 1,300 kilometres southeast of Algiers and about 60km west of the Libyan border. The hostages are predominantly foreign workers from the UK, France, Japan and the US.

The field is operated by BP, as well as the state-owned oil company Sonatrach and Norway’s Statoil.

The initial attack was on a bus carrying workers from the field. After the terrorists were repelled they drove to an accommodation compound nearby where they took the residents hostage. Reports also state that all Algerian workers were released.

According to Algeria’s interior minister, Daho Ould Kabila, the kidnappers are Algerian and are operating under the command of a rogue former al-Qaeda commander called Mokhtar Belmokhtar.

Initial reports stated that the attack was in response to the recent military action led by French forces in neighbouring Mali, but conflicting stories have emerged that say the kidnappers could have a profit-driven motive.

Foreign governments of all the kidnapped workers have expressed a desire to resolve the situation quickly and peacefully.